Enefit offers wind power for companies directly from the producer with a discount of up to 30%
Enefit, the second largest electricity trader in Latvia, has developed a unique green electricity purchase solution, which reduces electricity costs for companies at the same time contributing to their sustainability. Enefit is the first power trader, which offers long-term power purchase agreements (PPA) in the Baltic States. Within the framework of these contracts, the company directly purchases renewable energy from a particular wind farm and may agree on fixed long-term energy price, which is 20–30% lower than the actual market price of that moment.
Long-term wind power purchase agreement provides mutual benefit for both the company and the power producer. The company obtains opportunity to agree on more beneficial price and fix its power expenses for a longer period of time, at the same time developing a sustainable business model. Whereas, the wind power producers have an opportunity of stable planning of development. Interest in such a solution is very high, and, over the period of a couple of months, more than 100 contracts have been signed with companies across the Baltic States. The total amount of power purchases within the framework of the PPA reaches nearly 2 tera-watt hours, which is equal to electricity consumption of half a million households combined.
In the European countries, long-term power purchase is a common way for companies to provide electricity supply on favourable conditions, thus avoiding the risk of cost increase under the influence of fluctuations of energy prices. For many companies, it is also a convenient solution to switch to the use of renewable energy being clearly aware of origin of the energy and gaining added value in the eyes of customers and cooperation partners. Although such an approach is new in Latvia, many large companies already want to use this opportunity, which is facilitated also by the constant increase in electricity prices. For example, shopping and entertainment centre AKROPOLE and the company “Latvijas Piens” have recently decided in favour of purchase of the wind power.
“During the first quarter of this year, electricity prices at the exchange have grown by 26% compared to the last year's fourth quarter. According to the forecasts, similar tendency will remain in the market for the following years. At the moment, electricity price may be fixed for the period of up to 2031, and, compared to today's exchange price, long-term electricity agreement usually offers 20–30% lower price, thus providing the company an opportunity to reduce electricity costs,” explains Edgars Cvetkovs, Enefit Sales Manager.
Overall, increase in the interest of companies and consumers with regard to sustainable solutions and environmental care can be observed in the Baltic States. This means not only demand caused by consumers and purchasers for a greener approach to business, but also changes in the entrepreneurship environment. In the nearest future, financial institutions will determine the customers’ credit rating taking into account the company's sustainability, including the amount of generated CO2 emissions.
“We can see also a positive trend among the Enefit customers, that sustainability promoting solutions are increasingly introduced – from purchase of renewable energy and improvement of energy efficiency to solar energy solutions. In 2020, we have implemented more than 400 solar energy projects in the Baltic States, with the total power reaching 8.5 mega-watt. Thus, at the moment, more than 2,500 customers across the Baltic States act as the small energy producers by selling to Enefit electricity produced at their homes or companies,” specifies Edgars Cvetkovs.
In 2020, Enefit produced 1.5 tera-watt hours of renewable energy, which account for 40% of the total electricity production amount of the parent company Eesti Energia group. Amount of CO2 emissions generated by the company has reduced three times since 2018.